Building a solid and productive team is one of the most critical roles of a startup’s founder. Wasserman’s The Founder’s Dilemmas points out some of the benefits and risks associated with assembling a team that is very homogeneous versus one that is more diverse. Here is a quick summary of many of those points:
- Short-term benefits include ease of finding people, speed of decision making, quicker to develop productive working relationships, easier construction of shared organizational identity, and less risk of conflict.
- Longer-term risks include overlapping human capital resulting in overlapping strengths and gaps in expertise. There is potential for a shortage of creativity, greater difficulty in times of turbulence, stunted growth when friendship supersedes the best interest of the business, and a narrower network for identifying investors and employees.
Diversity and Counterbalance
Even more important might be the likelihood that homogeneous teams tend to have similar tolerance for risk and share similar values. This can make for a more stable partnership, but could also mean that there is no counterbalance if the team is too risky or too risk adverse. They may share priorities and preferences, but might struggle to counterbalance each other when their shared preferences are not in the best interest of the long-term success of the company.
Hiring a Great Team: A Competitive Advantage
Harrenkohl’s How to Hire A-Players points out that having an incredible team of high performers can be a significant competitive advantage to the organization. He points out that your business should have the leadership to continue on without you, so it is essential to have the right people in place and to give them the autonomy and authority to do great work. This requires, as we have discussed in previous posts, that the founder must be willing to give up decision-making control and resist the urge to micromanage.
Hiring great people attracts other great talent and creates a virtuous cycle of success. Not only are current people more likely to be retained when they are surrounded by excellence, but they are likely to continue to be engaged and perform at the highest level themselves. This positions everyone for the opportunity to advance their careers as the company grows and thrives.
Selfishly, as the founder it is in your best interest to hire great people even though it means yielding some of your control. Doing so will allow you to have more balance in your own life, as the company’s growth becomes a shared goal and not one that you alone must realize.